Microsoft squares Intertrust DRM suit for $440m

Peace of mind

Microsoft is paying $440m to settle its long-running digital rights management (DRM) patent infringement dispute with Intertrust. The one-off pay-out means that Microsoft customers can use their software "as they are intended to be used without requiring a license from InterTrust".

Anything else would have been intolerable, which may be why Microsoft opted to draw a line under this case. Marshall Phelps, Microsoft lawyer, said: "One of our goals with this and our broader intellectual property (IP) licensing program is to provide peace of mind for our customers and partners by letting them know that patent licensing is our responsibility." Quite.

Software developers working solely on the Microsoft platform will not be required to sign up for an Intertrust license. But they must sign on the dotted line if they are combining MS software with that of third parties. More here.

Intertrust filed its initial suit against Microsoft in June, 2001, and added more complaints along the way to take in just about all Microsoft platform software. Originally a lossmaking digital video software company, Intertrust ditched its operating business in May 2002, to concentrate solely on licensing technology developed inhouse to deliver content securely. The same month, it claimed an early IP licensing success in Sony, which paid $28.5m and agreed to pay royalties for the technology.

Sony was so convinced by the Intertrust claim that it teamed up with Philips to buy the firm for $453m in early 2003.

Microsoft has been in settling mood, lately. Last week, it settled an anti-trust dispute with Sun, perhaps its most vociferous opponent in the computer industry, for $2bn. The hush money means that Sun is withdrawing its complaint with the EC. However, the Commission's investigation into Microsoft's on competition grounds has long since developed its own momentum. Last month, the EC imposed a record fine on Microsoft and ordered the firm to unbundle Windows Media Player from Windows. Microsoft will appeal the ruling - the next step is a submission to the EU's Court of First Instance, in time for the 8 June deadline.